The Accuracy Analysis of Inflation Rate Forecasts in Euro Area

Abstract:

The main objective of this study is to provide a comparative analysis of the accuracy associated to
the inflation forecasts for euro area made by International Monetary Fund (IMF) and Organisation for
Economic Co-operation and Development (OECD). On the horizon from 2000 to 2013, IMF provided
significantly more accurate inflation rate forecasts compared to OECD, according to Diebold-Mariano test
and U1 Theil’s statistic value. Moreover, the predictions provided by the two institutions are better than the
naïve ones. All the predictions do not provide valuable information for future decisional process.